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How much would you pay to learn how to flip homes for a profit?
Well my guest today thinks that sort of education is worth as
much as $34,000.
And a lot of people actually pay it.
Than Merrill is familiar to many Americans from his appearances on the TV
show Flip This House.
And he's also CEO of a company called Fortune Builders that holds seminars
in dozens of cities, where instructors explain how to buy properties,
fix them up and sell them for a profit.
He joins me now from San Diego.
Then Merrill, I attended one of your free house flipping
seminars recently here in New York City, and I learned that
the free two hour workshop you advertise on the radio is actually meant to
recruit people into programs that can cost thousands of dollars.
With the most expensive one topping out at $33,997.
So why don't you explain why you set up your
programs that way instead of just advertising your pricing up front.
Sure, yeah one of the things, we've been coaching and
educating investors for six years and I think the most important thing.
When a student attends one of our workshops is to
give them an introduction to what the real estate business is.
Because real estate investing, clearly, it's not for everybody.
There is tremendous opportunity but there's also tremendous risk and
so I think.
The best way we've introduced people to our education is to
have a free 90 minute to two hour informational event.
And then you know,
we'll do three day workshops two to three weeks later after that.
For those individuals who wanna learn more.
And obviously real estate investing is a business, you know,
I, I'm, I wouldn't be here today if I hadn't invested very early on in my
education, and if I hadn't, you know, I've been studying the business for
the past ten years.
And some people think that maybe just watching a TV show or
reading a book is.
Enough to get started in real estate and frankly it's not.
There's too much risk in real estate to,
to think that that level of education is going to take somebody to,
you know, having a successful investment career.
So we like to introduce people to that, at our free informational workshops
and then when they come to our three day workshops, we're training them and
giving them a really good overview of all the different facets of the real
estate business.
How it works how it operates, what we've been doing for the past 10 years.
And then for those individuals who want to continue on, and
really make a career out of investing in real estate,
obviously we offer coaching and consulting services after that fact.
So, I talk to a lot of people who've been these programs.
There's a lot of talk about this on the.
internet, different websites.
A lot of people are fairly critical of the program.
And I wanna read you what one person said.
this- Sure. Is from a website.
Please, please before giving this scam outfit your 24,
$25 thousand, do your research.
Fortune builders will give you a slick presentation about they,
how they handpick a few, select individuals to let into their circle.
Well, you;re only special if you're willing to give them $25 thousand.
So, other people have voiced criticism like that.
What's your answer to that?
I, I think you have to look at the body of work of what we've done with
investors for the past six years.
You know, we've been coaching and consulting with investors and
I think our track record is pretty darn good with what we do.
First, first of all, from, from the attendees who attend our workshop, you
know, we've had thousands of attendees come to our three day workshop and
at the end of each workshop we survey.
Them, to find out their, what they thought about it.
And we have them rate us on a scale from one to ten.
And we consistently have rated out at a 9.5, or greater, over those years.
And so, I think that speaks to the volumes of,
of what we do in our workshop from a coaching perspective.
I mean, you have to look at the entire body of work we've.
Over the past few years we've been tracking what our students do.
And people who have voluntarily raised their hand and
said hey, I've been able to complete succesful real estate transactions.
Both wholesales, rehabs, and, and buying old properties.
It's over 2000 unique individuals.
And that's people who have done just a handful of deals to people that
are now doing multiple deals a month.
So.
I know from the results standpoint, we've we've overall, our,
our business has been really,
really successful from what we've been able to do for our students.
Of course, there are people that are critical.
There, there are people that you know,
can go online and, and have some criticism about a business.
I mean, we are a big business but
I think the most important thing is just looking at the [INAUDIBLE].
Entire body of work and, and talking to students that have actually been
through the program and, and applied themselves and executed the business.
So and I, and to be fair I, I do acknowledge on,
on the same websites where some of these complaints are, there are also
defenders who say you know everybody doesn't, this isn't for everybody and
you know if you don't think, if you think you're gonna have easy money.
Maybe this isn't for you but I do wanna bring up one other complaint that
really stands out on some of these websites.
Sure. And I, again,
I also talk to people who have the same complaint which is that when you
do introduce these expensive programs costing thousands of dollars,
there's a lot of pressure upon people to,
to put [INAUDIBLE] to, you put the cost of that on credit cards.
And even to apply for new credit cards or
ask the issuer to raise your credit limit, if necessary, to afford that.
Now, just about any consumer advocate would say that it's absolutely
the worst thing to do, to put any unnecessary expense on a credit card,
especially when you're gonna get double-digit interest rates.
So, you're trying to help people get ahead.
Why are you urging them to put.
You know, ten, twenty, thirty thousand dollars on a credit card,
especially if they might not be able to pay it off right away.
well, I wouldn't say we're urging anybody to do anything.
All of our students who come through our program are adults.
Many of them are active investors.
Some of them are new investors.
And every single one of them understands that they're starting a business.
I mean, to.
To get a college degree you have to utilize credit, you have to get.
You know, I went to school I utilized student loans to go through school.
I think the worst thing that you could ever do is invest in
real estate without an education.
And, I think there are people that talk about the good uses of credit and
the bad uses.
You know, when you use credit to go out there and buy a liability like
a big screen TV or an Escalade, that's utilizing credit the wrong way.
But if you're utilizing credit to get.
And education.
You know, I wouldn't be here today if I hadn't have spent and
invested thousands of dollars in my own education.
I know students that have been through our program have financed it
in a variety of different ways.
And they're, they're starting a business.
I mean, America is founded on credit.
And people that are starting businesses, I would say probably,
I don't have an actual statistic.
But I would say the overwhelming majority of them are financing on
them using business lines of credit, personal lines of credit.
I mean, they're starting a business and getting an education.
And so I believe very strongly in the value of credit.
My very first few properties, I financed the construction cost.
Using credit cards.
I financed my education utilizing credit cards.
So it's no different.
Although you know, at a university, you're gonna go to school.
And you're gonna get an educational loan to go through school to
better yourself.
I mean, the most important asset, the single most important asset I
think you can invest in is your education.
And so investors are looking to improve their lives.
Whether they choose to finance it, you know, utilizing cash or
savings or something of that veh.
I mean, that's completely up, up to what they do and
we do have students who ask us, hey, how can I do this?
And if we can point them.
There's some good financing sources.
It's no different than a university pi,
pointing somebody to a financing source to get a degree.
So. So. You know, I believe in what we teach.
I know the value that it brings to students and
so I believe whole-heartedly in, in utilizing credit.
I mean, you're starting a business and, and
you're gonna need to utilize credit to do that.
Since you're making that comparison with colleges and universities,.
It seems important to draw a few distinctions.
First of all, universities are accredited, and nobody's likely to
get approved for financing, whether it's a subsidized loan or
a private loan, for a university that's not accredited.
Second, nobody really puts the cost of college on a credit card.
If you get a subsidized loan,
it might be a three or four percent interest rate.
A private loan would be higher.
But you're still not going to put that on your credit card at 10,
15 or 20% interest.
And third colleges and universities have to disclose all their costs.
And beyond that they have to actually have
something called a net cost calculator on their websites so people can
figure out what the real bottom line cost is, when you boil it all down so,
why don't you adopt a more transp, transparent business model like that.
And perhaps even come up with some financing options for
people that aren't 20 percent on a credit card?
Sure, what, they, you had a lot of questions there so
let me address each one of them, in order.
First, first of all,
absolutely we're different than an accredited university.
I, I believe an accredited university has a place.
If, you know, if you're, if you want to advance.
Your career and get an extra degree, or you want, you know, most people
that go to accredited universities, we're taught when we're raised to
go to an accredited university and get a degree so we can get a good job.
We're on the other completely side, other end of the spectrum.
We're teaching people how to start a business.
And the only financing sources we have for people that are.
Trying to start a business.
I mean, if you're buying a franchise, or investing in a franchise,
they have financing sources business lines of credit and
personal lines of credit.
There aren't student loans for this type of education.
I so what we'll do is we will point if, if a student asks, we will
absolutely point them to the best financing sources that we know available.
And they're not all double digit credit card, believe me there's a lot of
zero percent interest business lines of credit for a very short period of
time or personal lines of credit for 12 month period of time.
So we're gonna try to give them the best financing sources that we can.
Not to say that everybody it util, utilizing credit I think.
You, you know.
You're asking a question.
And kinda pinpointing one financing source that people utilize to,
to get started with our program.
There's many people that just write a check.
There's many people that have assets that they,
they've accumulated over the years to get involved with the program.
So I think we're very clear about the costs.
People know exa, I mean, they're there with us for three days.
They know the costs.
To start a business and they know it, it's definitely not for everybody.
I mean, you, you have to be able to financially afford the program.
You have to have the time to do the program.
Okay, Stan Merrill, thank you very much for joining us.
Real estate investors of America, tell us what you think.
Is flipping worth it, and would you pay to play?
Tell us in the comments below or on Facebook and Twitter.
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